Essay About Competition Bikes And Bike Races

Competition Bikes Financial Analysis
Competition Bikes, Inc.
Competition Bikes, Inc. makes bicycles for professional and other highly accomplished riders
who compete in bike races, biathlons, and triathlons.
Sixty percent of all race winners have been victorious using a Competition Bikes, Inc.
bicycle when at least ten percent of the entrants were also using a Competition Bikes, Inc.
bicycle. This extraordinary success rate consistently is a topic of conversation among racers
and this word of mouth advertising has been effective in promoting sales. The company also
uses these statistics to promote sales, although its advertising efforts have been quite
limited.
The Main Competitor
Two Wheel Racing, Inc. is the only other manufacturer that offers a competitive product in
this market space. Their product weighs only a few ounces more than the bikes made by
Competition Bikes, Inc. but Two Wheel Racing builds a chain driven product.
Two Wheel Racing, Inc is also a publicly traded company. Their financial ratios are provided
for comparison and analysis.
THE COMPANY AND ITS CENTRAL OPERATIONS
Ownership History:
Larry Ferguson formed the company in 2001 in his garage. An avid racer, Larry often heard
comments from other riders about how heavy and unreliable their bikes were. Larry
identified and sought to remedy this market niche by creating a specialized product that
would satisfy the needs of racers. His new company also proved to be a vehicle for financial
success.
Early success prompted Larry to take the company public after three years in order to
acquire sufficient capital to build the two current manufacturing facilities. His bikes enjoyed
high demand and good profit margins. Larry continues to be the CEO of the Competition
Bikes, Inc. and retains a 40% interest of company shares.
Standard Company Procedures for Operations
Each of the manufacturing locations for Competition Bikes, Inc. uses operating procedures
based on department and function, as applicable. The